Sime Darby Property Acquires 557 Acres in Johor for RM418.5 Million to Develop RM3 Billion Township

Sime Darby Property Bhd has announced that its wholly-owned subsidiary, Sime Darby Property (Kulai) Sdn Bhd, has agreed to acquire approximately 556.96 acres (225.39 hectares) of freehold land in Kulai Estate, Johor, from SD Guthrie Bhd for RM418.5 million. The acquisition represents a significant strategic move for the property developer as it strengthens its presence in Johor's rapidly growing property market.

The group plans to develop the land strategically located along Jalan Kulai-Kota Tinggi within Flagship Zone F (Kulai-Sedenak) of the Johor-Singapore Special Economic Zone (JS-SEZ) into a sustainable township comprising landed residential and commercial developments, with an estimated gross development value (GDV) of approximately RM3 billion. The development will be phased over the next 10 to 15 years, with the first phase targeted for launch in 2028.

Strategic Location within the JS-SEZ

The acquisition site is situated within one of Johor's most promising growth corridors. The Johor-Singapore Special Economic Zone has been a focal point for economic development, attracting significant investment from both domestic and international players. The Kulai-Sedenak zone, in particular, has emerged as a key industrial and residential hub, benefiting from its proximity to Singapore and its connectivity to major infrastructure projects.

The location along Jalan Kulai-Kota Tinggi provides excellent accessibility to key economic nodes, including the Senai International Airport, the Port of Tanjung Pelepas, and the Johor Bahru city centre. The area has also seen increasing interest from data centre operators and industrial developers, further boosting its economic significance.

Development Plans

The proposed township will be developed on a 557-acre site, with plans to integrate both residential and commercial components. The residential component will feature landed properties, including terrace houses, semi-detached homes, and bungalows, catering to a range of buyer profiles from first-time homeowners to upgraders and investors. The commercial component will include retail spaces, offices, and potentially other commercial uses to support the township's population and surrounding community.

According to the group, the project will broaden its geographical earnings base beyond the Klang Valley and Negeri Sembilan, while reinforcing its long-term growth pipeline through the addition of a sizeable strategic landbank in one of Johor's key growth corridors.

Management Commentary

Datuk Seri Azmir Merican, Group Managing Director and Chief Executive Officer of Sime Darby Property, commented on the acquisition: "The acquisition marks another strategic milestone for Sime Darby Property as we continue to strengthen our footprint in Johor. Located within the highly anticipated Johor-Singapore Special Economic Zone, this site presents an opportunity to create a sustainable township that builds on our proven track record of developing integrated, thriving communities."

Azmir's comments underscore the group's commitment to expanding its presence in Johor, a state that has seen significant growth in property development activity in recent years. The group's track record in developing large-scale townships, including its flagship developments in the Klang Valley, positions it well to deliver on the proposed development.

Financial Implications

The acquisition price of RM418.5 million translates to approximately RM1.72 million per acre, reflecting the strategic value of the land within the JS-SEZ. The development is expected to generate significant returns for the group, with an estimated GDV of RM3 billion. The first phase is targeted for launch in 2028, with the overall development expected to be completed over the next 10 to 15 years.

The acquisition is expected to be funded through internally generated funds and/or bank borrowings. Sime Darby Property's strong balance sheet and established track record in large-scale developments provide confidence in its ability to execute the project successfully.

Johor's Property Market Outlook

Johor's property market has shown resilience in recent years, supported by the state's economic growth, infrastructure development, and proximity to Singapore. The Johor-Singapore Special Economic Zone has been a key driver of investment activity, attracting both residential and commercial developments.

The Kulai-Sedenak area, in particular, has seen increasing interest from property developers, driven by its strategic location and the growing demand for industrial and residential space. The area benefits from its proximity to the Senai International Airport and the Port of Tanjung Pelepas, as well as its connectivity to major highways.

Sime Darby Property's entry into the area through this acquisition positions the group to capture a share of the growth in this corridor, leveraging its experience in developing integrated townships.

Sime Darby Property's acquisition of 557 acres in Kulai Estate, Johor, represents a strategic move to strengthen its footprint in one of Malaysia's key growth corridors. The development of a sustainable township with an estimated GDV of RM3 billion will diversify the group's geographical earnings base while capitalising on the growth potential of the Johor-Singapore Special Economic Zone.

With the first phase targeted for launch in 2028, the project will contribute to the group's long-term growth pipeline and reinforce its position as a leading property developer in Malaysia. The acquisition underscores Sime Darby Property's commitment to creating sustainable, thriving communities that meet the needs of modern living.